Elevated Selic rate puts pressure on bank interest rates, slows credit, and increases default rates in 2025.
Rising interest rates are causing banks to make loans more expensive, slowing credit expansion and pushing default rates to high levels, according to official data.
47 - The restrictive monetary policy adopted to contain inflation had direct effects on the cost of credit in Brazil in 2025. With the Selic rate at a high level, the interest rates charged by banks rose significantly throughout the year, contributing to the slowdown in credit and the increase in defaults among families and businesses.
According to the monetary authority, the average bank interest rate will rise by 6,5 percentage points in 2025, the largest increase since 2022, when the rise was 7,8 percentage points. The calculation considers only operations with free resources, excluding housing credit, rural credit, and BNDES financing.
Throughout 2025, the Selic rate accumulated an increase of 2,25 percentage points, reaching its highest level in almost two decades. In addition to passing on the increased cost of basic money, banks raised their rates above this upward trend. In corporate lending, average interest rates rose from 21,7% per year in December 2024 to 25% per year at the end of 2025, an increase of 3,3 percentage points.
For individuals, the increase was even more pronounced. The average rate rose from 53,1% per year at the end of 2024 to 60,1% per year at the end of 2025, an increase of 7 percentage points. This movement occurs in a context where the Selic rate has been maintained at 15% per year by the Monetary Policy Committee (Copom) for the fourth consecutive meeting.
Among the most expensive credit options, overdraft facilities saw a further increase. The average rate charged to individuals rose from 134,8% per year in December 2024 to 138,6% per year at the end of 2025, an increase of 3,8 percentage points over the period.
Regarding revolving credit cards, interest rates have decreased, although the level remains extremely high. The average rate fell from 451,6% per year at the end of 2024 to 438% per year in December 2025, a reduction of 13,6 percentage points. Even so, it is the most expensive line of credit in the financial system, costing about 30 times more than the basic interest rate of the economy.
Since January, the total amount of debt on revolving credit cannot exceed twice the original balance, excluding the IOF tax. This rule applies only to debts incurred from that period onwards. Revolving credit is activated when the consumer does not pay the credit card bill in full by the due date.
The increased cost of credit also impacted the pace of expansion of the financial system. According to the Central Bank, the total stock of bank credit grew by 10,2% in 2025, reaching R$ 7,12 trillion. This result represents a slowdown compared to 2024, when growth was 11,5%, considering adjusted values.
The slowdown was already expected by the monetary authority, given the high level of the Selic rate. For 2026, the Central Bank projects even lower credit growth, estimated at 8,6%.
Meanwhile, delinquency increased significantly. The average rate of late payments rose from 3% at the end of 2024 to 4,1% at the end of 2025, one of the highest levels in the historical series that began in March 2011.
Among individuals, the default rate increased from 3,5% in December 2024 to 5% at the end of 2025, a rise of 1,5 percentage points. In the business segment, the rate rose from 2% to 2,5% in the same period, an increase of 0,5 percentage points.
